When Russia sold Alaska to the United States: the worst deal in history

Russia was the first European country to set foot in Alaska. The first groups, led by hunters, arrived at the beginning of the 18th century, and a few decades later the first expeditions of fur traders arrived, who had already settled in the region, and began the colonization, which was completed at the end of the century.

The initial relationship with the natives was cordial. In fact, they bought otter skin from them, perhaps the most precious of the jewels that the territory offered at that time. Over time, things became more complicated, especially due to the abuse of otter hunting, which ended up exterminating the animal in many areas; along with some problems of coexistence that they did not know how to solve, and that ended up leading to armed confrontations, expulsion of the natives, division of families, slavery… and many deaths among the locals.

Nor did the silent killer that accompanied the Russians help: European diseases, unknown in the region, and against which the locals were not immunized. 80% of the Aleut population, for example, died for this reason.

Missionaries and clergymen of the Orthodox religion also arrived at that time, which continued throughout the 19th century, and which is responsible for the most visible Russian traces in contemporary Alaska.

The Spanish attempt

At that time, the Spanish also set their sights on Alaska, relying on the papal bull of 1493 that Alexander VI granted to Isabel and Fernando. Over the decades they sent various naval expeditions, some of which even came into contact with the Russians. The most daring was that of Bruno de Heceta, who in 1775 tried to consolidate Spanish claims in the North Pacific. One of his ships, the Sonora, entered the island of Nootka, and formally claimed the region as part of Spain.

That movement ended up leading to the Nootka crisis in 1789, which was about to provoke a war between Spain and the United Kingdom, after several British ships entered waters claimed by Spain, for which they were captured by the Navy. London demanded compensation, and Madrid refused. They came to prepare for the warlike confrontation, and even demanded the help of their respective allies.

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However, the blood did not reach the river, and it was resolved peacefully in the Nootka Convention, in an agreement that was a great commercial victory for the United Kingdom, and that marked the beginning of its dominance over the Pacific.

Today, the Spanish legacy is preserved in place names such as the Malaspina Glacier, Revillagigedo Island, or the cities of Valdez and Cordova.

The Russian population never exceeded 700 people

But getting back to Alaska and the Russians, the turn of the century didn’t sit well with him. Despite some military victories, the local clans never stopped making war on them. And the efforts they made were never enough to fully colonize the region. In fact, the Russian population never exceeded 700 people at its peak. Despite the riches of the territory, where they already knew that there was also gold, how expensive, complicated and dangerous the trips were, they did not manage to convince more Russians to move.

To this we must add that the Canadian Hudson’s Bay Company was established on the southern border, and never came to respect the established limitations, punishing the Russian monopoly of trade in the region. Between one thing and another, the control of the Russians over Alaska was weakening more and more.

We thus arrive in the middle of the 19th century, in which Russia finds itself in a difficult financial situation. , which is forcing him to make a major war effort, and he can’t pay attention to what’s going on in Alaska. Those closest to the tsar begin to put forward the idea that it is best to leave the region, that the United States wants to conquer the entire continent, and that it could easily take the land from them, without getting anything in return. They raise the option of selling it, and Alexander II decides that it is a decision worth studying.

Negotiation

Talks began in the 19th century, but the Civil War stalled negotiations. After the end of the conflict, the negotiations resumed, reaching their peak in March 1867, when the Tsar sent his minister in the United States to negotiate with William Seward, the Secretary of State. In just a few weeks, they close the deal: the United States would pay 7.2 million dollars for Alaska.

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The price, which would be equivalent to about 130 million dollars today, is less than what it costs to sign a star footballer, it was cheap even by the standards of the time.

The check with which the purchase of Alaska was paid.

The United States flag was raised on October 18, 1867, and given the need to change from the Julian to the Gregorian calendar, along with the change in time zone, it caused residents to have two Fridays in a row: they went from Friday October 6 to Friday October 18.

Despite the fact that the United States was in the midst of an expansionist process, and reached similar agreements to take over other regions, such as Louisiana or Florida, there were many doubts among the citizens, who considered it to be an “icy place”. In fact, some of the press attacked the agreement, calling it ‘Seward’s Folly’, ‘Seward’s Icebox’ or ‘Andrew Johnson’s Polar Bear Garden’.

But the voices against were quickly silenced. Despite decades of Russian rule, it was virtually unexplored land. During the first years after the agreement, with Washington politicians more concerned with the reconstruction of the country after the War than with the new territory they had bought, it was the military and explorers who began to tour the region, paint the first maps of the river Yukon, and establishing trading posts along the many inland rivers.

Gold Rush

And in 1896 the event occurs that would change everything. In the Yukon Territory in Canada they find gold. Thousands of miners, accompanied by new settlers, decide to go to Alaska, to see if they can find it there too. These thousands of people demand infrastructure and services, which is a great boost for the region.

Just three years later, explorers find gold in Nome and other towns, which became known as ‘the Klondike gold rush’, and which was the definitive boost for Alaska.

The turn of the century marked an economic leap for the region, with the construction of new urban centers to accommodate all the people who were arriving. The copper mining, fishing and canning industries begin to become popular. There are cities that already have up to ten canning factories. Americans also expanded into the Alaskan interior and Arctic, exploiting animal fur, fish, and other businesses the natives depended on.

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In the first 50 years of ownership, Americans had already earned 100 times more than what they invested in the purchase.

World War II and the beginning of the Cold War also reflected . The military presence increases, and in 1959 the territory is incorporated as a State of the United States.

At the same time, which represent a new impetus for the region, and which has been consolidating as the main source of income. In the 70’s they built an 8,000 million oil pipeline that linked it to the rest of the country. It generated income per capita so high that it affected the entire population.

The Alaska Permanent Fund

To prevent it from ending as badly as that of the otter skin, whose economic improvements ceased to be felt as soon as the resources ran out, , a trust with which they invest a quarter of all mineral income.

The result was a success. In half a century it has gone from controlling 734,000 dollars, which is what it was born with in 1976, to more than 82,000 million today. In addition, since 1982, it has paid an annual dividend to each citizen who resides in Alaska for at least 6 months, a kind of basic income, for which they pay about 2,000 dollars per capita per year. It has generated more money than oil.

Today Alaska has a population of about 700,000 people. 15% of the population is native. And the only thing that remains Russian are some buildings and the strong presence of the Orthodox Church.

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